Unpicked coffee. 2008 Creative Commons photo by John Pavelka
by Michael Sheridan of CRS Coffeelands Blog
Over the past year and a half, I have done some reading about two related and complementary disciplines: horizon-scanning and scenario planning. The first refers to intentional and systematic efforts to gather and analyze information about threats and opportunities that loom; the second to how we use that intelligence to identify likely future scenarios and develop strategies that will help us navigate them more effectively.
There are some companies in coffee that are pretty good at identifying and seizing opportunities in the marketplace. The dizzying pace of innovation and the occasional introduction of disruptive technologies over the past 10 years can attest to that. And lots of companies are effectively identifying and heading off challenges in their supply chains. But we haven’t been as good at identifying collective threats before it is too late.
The coffee leaf rust crisis in Central America during the 2012-13 crop year is a recent and painful example. There were people calling attention to coffee leaf rust before the epidemic hit Mesoamerica, but we failed to recognize the magnitude of the threat. Peter Baker, the coffee and climate scientist, reminded the First Coffee Rust Summit in Guatemala City in 2013 that there were warnings as early as 2010. There is, of course, no guarantee we would have been able to effectively mitigate the threat posed by coffee leaf rust if we had done a better job of what the literature on horizon-scanning calls “amplifying weak signals.” But our collective failure to amplify this weak signal meant we were blindsided by something we could have seen coming.
Labor markets in coffee-growing countries in the Americas have been emitting a steady but weak signal in recent years that has been growing stronger but could still use some amplification: labor shortages represent a threat to the viability of coffee production.
Reuters news service published a story earlier this month about labor shortages in the coffeelands in Colombia. It is one of the few stories that have been published on the topic in English, but that doesn’t make it a new story. Securing labor for the coffee harvest in Colombia has been a perennial challenge in recent years — one that has been more difficult as Colombia’s production gone from just over 7 million bags per year to nearly 13 million. There is more coffee than ever in Colombia, and not enough workers to harvest it.
Why?
Well, for one, it is hard work.
It doesn’t pay particularly well.
And few farmworkers have the kinds of formal contracts and labor protections they can secure in other sectors of Colombia’s economy.
In other words, there are lots of better ways to make a living.
This is especially true in countries like Colombia whose economy has been booming while economies in “developing” countries have been slumping. But Colombia isn’t the only one. Similar stories have been reported over the years in coffee origins from Mexico to Peru and many places in between.
The specialty coffee community may not feel moved by the plight of coffee farmworkers. But it may be moved to action by the fact that the lack of farm labor in the coffeelands could mean steadily less coffee for the marketplace.
Addressing this challenge won’t be easy, because there is structural pressure on wages. One estate owner told me recently that “this is the one problem I have on the farm that I don’t know how to solve.” His ability to offer more money to workers is constrained by the economics of the coffee market: he simply doesn’t earn enough for his coffee to pay more than he is already paying.
We need to talk about farmworkers before it is too late. A conversation by itself won’t solve anything, of course, if it doesn’t lead to changes in the low wages and poor working conditions that have made work on coffee farms unattractive in many producing countries. But the first step in solving a problem is acknowledging we have one. And we do.
If we have a full-blown labor crisis in coffee, we can’t say we didn’t see it coming.
Michael Sheridan
Michael Sheridan is the Director of Sourcing and Shared Value at Intelligentsia Coffee. He also orchestrates the Extraordinary Coffee Workshop (ECW), an annual supply chain summit that convenes Intelligentsia’s Direct Trade partners from around the world. Prior to joining Intelligentsia, Sheridan led coffee programming for the international development agency CRS for more than a decade. He is a member of the SCA’s Sustainability Center Advisory Council, and has served as a volunteer advisor to the industry on sustainability issues since 2012.
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The problem is Brazil, we base all the world’s coffee on C price. Every year we await Brazil’s production figures and again this year the price goes down. Why is coffee worth $1.25 per pound now when it costs a farmer $1.60 to produce? How is he supposed to pay for workers to pick. If you are going to treat our specialty coffee as a commodity, the first to be driven out will be the Central Americans and Africans. And there you have it, fine machine picked Brazilian Naturals. And only the best Central American farm or African farms will survive, and maybe one day we can treat specialty coffee as fine wines of Napa.
Michael aren’t you missing a basic law of economics. When supply goes down the price goes up. The solution isn’t going to be less coffee it is going to be more money for the worker and the farmer and more cost for the processor, the distributor, the roaster and the consumer. If processors want coffee they are going to raise their prices to the farmers. If farmers want workers they are going to raise their wages to the workers.
I don’t see this as a negative. Consumers can afford a few more cents for their coffee to support workers and their children living in poverty. ( As an economic anomaly that indicates the truth of what I am saying about consumer price elasticity, the headlines this morning were “Cost of coffee going down” and “Starbucks is raising its prices 20 cents”)
Instead of fear mongering about lack of workers in coffee lands, it would be more productive to advocate fair wages for workers and no children in the fields. This may raise the price of coffee to consumers but I think they can afford it.
Karen:
I think we agree, both on the underlying economics of farm labor and the idea that consumers can and would pay more for their coffee if there were a reliable mechanism for transferring their premiums to farmworkers.
And I do advocate for higher wages for coffee workers. Unfortunately, my experience suggests that the market doesn’t always obey the dictates of conscience. Which is where laws to protect farmworkers come in handy. But the market has also shown a kind of immunity even to laws when these are expensive or ill-enforced.
This post isn’t fear-mongering. I see it more as reporting–sharing a perspective from the coffeelands that isn’t getting much attention in specialty coffee’s public conversation on sustainability. A perspective that may help reframe the emerging discussion of farmworkers in coffee: those who may not be moved by an appeal to ethics may be moved by what they perceive as an emergig challenge to the viability of their business model.
Michael
Michael
You are right we agree more than we disagree. You are a strong voice in the community for ethical treatment of workers and farmers. You shouldn’t give up on making changes.
Consumers would be shocked if they knew how little of the retail price of their coffee was the farmers share, how little the workers who picked and processed the coffee were paid and how many children picked and processed the beans.
You have the bully pulpit to let roasters know that if they don’t insure a fair income for farmers and workers that consumers will be told how badly workers and children are being exploited. With direct farm to roaster purchasing now becoming more prevalent, it is a good time to tag on ethical payments to farmers and workers with the direct sales. Roasters and retailers who are proud of their direct farm purchases can be encouraged to add on that their efforts result in the workers and farmers who produced the coffee receiving a living wage and that children did not pick or process the beans
Certification labels are not doing it. (They make nice bandages for liberal guilt.) Paying the co-op after a fee for the certification administration is not getting the money to the worker and the farmer.